|Title:||Overconfidence, Underconfidence, and Welfare|
|Publisher:||Institute of Economic Research, Kyoto University|
|Journal title:||KIER Discussion Paper|
|Abstract:||Using a simple framework of Cooper and John (1988) and Cooper (1999), this paper derives the conditions under which overconfidence and underconfidence of agents lead to Pareto improvement. We show that an agent's overconfidence in a game exhibiting strategic complementarity and positive spillovers and an agent's underconfidence in a game exhibiting strategic complementarity and negative spillovers can lead to Pareto improvement.|
|Appears in Collections:||KIER Discussion Paper (English)|
Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.